Dundee council bosses forced to scrap £12.8m of debt

Dundee City Council has written off £12.8 million of debt in just three years, the Tele can reveal.

An investigation into the local authority’s finances has uncovered the large sums owed to the public purse that were written off between 2013 and 2016.

That included more than £4.75m in unpaid rates from businesses, £2m in unpaid council tax and almost £1m in housing benefit overpayments which had not been handed back.

In addition, £1.8m of unpaid rent was written off from the council’s housing revenue account.

The write-offs include historical debt from before 2013 which the council only decided to scrap in the last three years.

The information was released just weeks after the local authority revealed it has to make £12.5m worth of cuts from its budget in 2017/18.

One councillor has called for greater transparency from the council over its efforts to collect unpaid debts.

Kevin Keenan, leader of the opposition Labour party, said: “They should be providing a report detailing what they do to recover these debts and keep councillors aware. We do not see any reports saying what has been written off.

“They need to keep people informed so they feel confident that every effort has been made.”

However, Greg Colgan, head of customer services at the local authority, insisted “all reasonable steps” were taken to recover the money before any debt was written off.

Mr Colgan, who oversees council tax, housing benefits and IT services, said: “We offer support and advice for those unable to pay and take all reasonable steps to recover debt — but in some cases we can’t.

“Writing it off does not mean it is not recoverable. If we can’t find someone now but two years later we can, we can work to recover the money.”

SNP councillor Willie Sawers, finance convener on the council’s administration, said that some circumstances were beyond the authority’s control, leaving it with no choice but to write the debt off.

He said: “If a business goes into administration and has no assets, we have to write that off. If people who owe council tax have died and there’s no estate, we can’t get that money.

“There is a non-collection rate of council tax built into our budget each year and that has remained fairly steady for the last few years.”

Mr Sawers added: “We use a wide range of resources to recover debt and have encouraged people to pay their debts to help the council provide services. It is important to put the debt in context — it’s a very small percentage of all charges the council levies.”

Meanwhile, Mr Sawers insisted there would be a “minimal impact” on public services in this month’s budget, despite further savings having to be made.

He said: “I think when we publish our proposals people will be able to understand — there will be minimal change to service provision.”